White House defends freezing funds as 'reasonable' while Democrats express 'extreme alarm'
Getty ImagesUS President Donald Trump has paused grants, loans and other federal assistance, according to a leaked government memo, later confirmed by the White House.
The two-page memo, from the acting head of the White House budget office, instructs agencies to "temporarily pause all activities related to obligations or disbursement of all Federal financial assistance".
Much about the order, which went into effect on Tuesday afternoon, and its scope remain unclear, sowing widespread confusion.
The directive could paralyse billions of dollars meant for federal programmes, from disaster relief to cancer research.
Democrats have warned it may have brutal and far-reaching consequences.
In her first news conference as White House press secretary, Karoline Leavitt defended the directive, saying the motivation for the freeze is being "good stewards for tax dollars".
"I think this is a very reasonable measure," she said on Tuesday, adding that the pause would allow the government to weed out spending for "woke" gender issues and diversity programmes that conflict with Trump's executive orders.
Medicare and Social Security benefits will not be affected, nor will any programme "that provides direct benefits to individuals", including Supplemental Nutrition Assistance Program, known as SNAP or food stamps, the White House said.
But Leavitt did not clarify how aid to individuals would be protected in practice, as much of it goes first to state governments and other organisations, which then pass the assistance on to individuals. Leavitt also did not rule out Medicaid, a jointly run federal and state program which provides health insurance to low-income Americans, being cut off.
On Tuesday, hours after the late-night order was issued, the White House issued a second memo, with further information.
The pause is not "across the board", the second memo said, but applies only to projects implicated by Trump's various executive orders, including those that aimed at scraping diversity programmes in the federal government.
Democrats have assailed the freeze, saying it will bring chaos and harm to millions of Americans and warning it violates federal law.
In a letter to the White House, top Democrats expressed "extreme alarm".
"The scope of what you are ordering is breathtaking, unprecedented, and will have devastating consequences across the country," wrote Washington Senator Patty Murray and Connecticut Congresswoman Rosa DeLauro.
"We write today to urge you in the strongest possible terms to uphold the law and the Constitution and ensure all federal resources are delivered in accordance with the law."
A coalition of Democratic states attorneys general said they will file suit to block the order, calling it unconstitutional.
"My office will be taking imminent legal action against this administration's unconstitutional pause on federal funding," New York Attorney General Letitia James wrote on social media. "We won't sit idly by while this administration harms our families."
In the Monday evening memo, which comes days after the US halted nearly all foreign aid, the acting head of the Office of Management and Budget (OMB) Matthew Vaeth called on government agencies to ensure spending is consistent with Trump's priorities.
Federal agencies must "temporarily pause all activities related to obligation or disbursement of all federal financial assistance," and any other programs that included "DEI, woke gender ideology and the Green New Deal," Vaeth wrote.
DEI (Diversity, Equity and Inclusion) programmes aim to promote participation in workplaces by people from a range of backgrounds.
Their backers say they address historical or ongoing discrimination and underrepresentation of certain groups, including racial minorities, but critics argue such programmes can themselves be discriminatory.
The Green New Deal, a proposal to prevent climate change through public policy, was never signed into law.
Vaeth suggested that the pause would last until at least mid-February, asking agencies to provide a detailed report on the programmes that have been affected by 10 February.
It remains uncertain how much money is involved. The memo suggests that the federal government spent $10tn (£8tn) in fiscal year 2024, more than $3tn of which went to federal financial assistance. But the source of those numbers is unclear. The nonpartisan Congressional Budget Office reported that the government spent $6.7tn that year.
Nonprofit groups have responded in distress.
"This order is a potential five-alarm fire for nonprofit organizations and the people and communities they serve," Diane Yentel, the chief executive of the National Council of Nonprofits, said in a statement.
"From pausing research on cures for childhood cancer to halting food assistance, safety from domestic violence and closing suicide hotlines, the impact of even a short pause in funding could be devastating and cost lives," she added.
The move follows last week's news that the Department of State had issued a halt to nearly all existing foreign assistance and paused new aid, according to an internal memo sent to officials and US embassies abroad.
It appeared to affect everything from development assistance to military aid, making exceptions only for emergency food aid and for military funding for Israel and Egypt.
Trump earlier issued an executive order for a 90-day pause in foreign development assistance pending a review of efficiencies and consistency with his foreign policy.
The US is the world's biggest international aid donor, having spent $68bn (£66bn) in 2023 according to government figures.
